SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
LITIGATION RELEASE NO. 15458/August 22, 1997
SECURITIES AND EXCHANGE COMMISSION V. WEDGEWOOD FINANCIAL GROUP, INC., ET.
AL., Case No. 97-6350-CIV-RYSKAMP (S.D. Fla.)
The Securities and Exchange Commission announced that on April 10,
1997, the Honorable Kenneth L. Ryskamp, United States District Judge for
the Southern District of Florida, preliminarily enjoined defendants
Wedgewood Financial Group, Inc. ("Wedgewood"), its president, William
Scrak, Paul Iwankowski, JPI Site Management, Inc. ("JPI"), and Colorado
Paging Group Partners ("Colorado Paging"), from offering or selling
interests in what the SEC alleges are fraudulent paging license
partnerships, and also freezing defendants' assets. The preliminary
injunction enjoins the defendants from violating Section 17(a) of the
Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of
1934 ("Exchange Act") and Rule 10b-5 thereunder and, additionally,
Wedgewood from violating Section 15(a) of the Exchange Act. Iwankowski
consented to the Court's actions, and Scrak did not dispute the SEC's
allegations.
In an earlier coordinated effort, on April 4, 1997, the SEC sought and
obtained a temporary restraining order and asset freeze and the Federal
Bureau of Investigation executed a search warrant for Wedgewood's offices.
The SEC and a court-appointed receiver secured the premises and the
receiver is now in possession of the office and all company records have
been seized.
According to the SEC's complaint, Wedgewood, a Florida-based company,
is run by Scrak, who is a repeat securities violator previously found by
state securities agencies to have committed fraud in connection with the
sale of unregistered securities. The complaint also alleges that
Iwankowski, of Coral Springs, Florida, through JPI, a company controlled by
his wife Joanna Iwankowski, is the mastermind behind the fraudulent
securities offerings. According to the complaint, Iwankowski is also a
recidivist securities violator currently subject to an SEC permanent
injunction arising out of his prior involvement in a similar scheme.
The SEC's complaint alleges that the defendants' current offering,
Colorado Paging, is the third in a series of fraudulent offerings in which
unsophisticated investors are lured into investing in bogus paging
partnerships. Investors allegedly are told that the paging industry is
poised for explosive growth, promised extravagant returns, assured that
substantial additional financing is already in place, and promised that the
paging business will be run by an experienced team which has already been
retained. According to the Complaint, none of this is true. Among other
things alleged in the Complaint, the prior partnerships are not operational
-- much less successful -- and substantial investor sums appear to have
been and continue to be stolen by Defendants.
In addition to a permanent injunction, the SEC's action also seeks
disgorgement of ill-gotten profits and money penalties.
Named as relief defendants in the Commission's lawsuit were Stonepine
Holding, Ltd., Robert Fabregas, Prime Tel Paging Group Partners, Randy
Gilbert, Darrell Bauguess and Joanna Iwankowski.
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